Don't waste valuable resources: Forrest

24 Jul, 2017 11:34 AM
ortescue Metals chairman Andrew Forrest (left) with rural marketing agent Cate Mercier-Grant, and Marcus Oldham College Foundation chairman Antony Baillieu at the launch of the college's building fundraising effort recently.
ortescue Metals chairman Andrew Forrest (left) with rural marketing agent Cate Mercier-Grant, and Marcus Oldham College Foundation chairman Antony Baillieu at the launch of the college's building fundraising effort recently.

THE mining boom made him rich, but billionaire Andrew Forrest is almost breathless in his enthusiasm for the future of agricultural prosperity in Australia.

The Fortescue Metals chairman, whose expanding beef business includes a 50,000 head Angus-Droughtmaster herd and Harvey Beef meatworks, said he would be investing further in agriculture.

He also hopes to see regional communities make the most of big opportunities he foresees in a “strong multi-generational future” for the farm sector.

However Mr Forrest is also worried about Australia’s relatively expensive farm exports, particularly livestock products, losing market ground to less ethical, low-cost producers and processors – many of whom are now our customers.

“I have enormous faith in our agriculture sector,” he told farmers, agribusiness leaders and tertiary students in Melbourne last week.

“Generation after generation of Australian farmers, including family farmers, will have a strong future, particularly if we can come together and sell our agricultural production under a recognisable Australian label to overseas customers,” he said.

Corporate investors, too, were playing invaluable roles, testing and introducing technology to cut costs and make productivity gains unimaginable a generation ago.

Agriculture needed those breakthroughs and the skills and work ethic of agricultural graduates and others in the rural sector to maintain the industry’s newfound export momentum and earnings growth.

Demand for Australian food exports in the next 15 years would be far beyond our ability to deliver.

However Mr Forrest warned Australia could waste its valuable agricultural resources and high production standards by becoming little more than a saleyard or grain store for buyers with foreign processing and profit agendas.

He told a Marcus Oldham College Foundation fundraising event, that Australia’s comparatively small, but highly credible, farm productivity effort and expertise was threatened by fast-emerging rival food producers and processors who lacked the same sort of ethical credentials or priorities.

Mr Forrest particularly cautioned against the beef industry being “very much in a hurry to export live cattle overseas”.

Australia risked giving other countries with less credible standards and employment regimes the chance to convert our livestock into high value meat products, effectively undermining our own higher cost processes with their own low-cost, low-care operations.

“You can be assured their competitiveness against Australian value-added exports is being achieved through their lack of attention to human rights and a non-existent care for animals,” he said.

Australia’s credibility as an ethical, responsible and humane producer of quality livestock or cropping products came at a cost which some foreign players did not wear, and these food market rivals would use that competitiveness to grow their own marketplace, their economies and the future for their children – “and we will just be their saleyard”.

Mr Forrest’s comments were a not-too-subtle jab at recent moves by fellow WA mining success story and pastoralist, Gina Rinehart’s joint venture plans with Chinese buyers for a huge live export supply chain from northern Australia.

Ms Rinehart’s Hancock and S. Kidman and Company beef businesses eventually hope to supply 800,000 live cattle a year to Jintang Island, near the big southern Chinese port city, Ningbo.

Hancock’s bold plan has raised questions in Canberra about the impact on local meat supply chains and whether the cheaply Chinese-processed beef will sell in China, or elsewhere, branded as Australian.

Mr Forrest believed Chinese customers would actually prefer their Australian meat, milk or other food imports processed in Australia.

“Surveys of Chinese consumers, even poor families, show they always look to Australia as their preferred source.

“If we’re sensible we should be coming together to brand our farm products with a label consumers in China and elsewhere recognise with confidence as Australian.”

However, when he “walked the streets of China and other Asian cities” he never found a universally recognised Australian brand or label which symbolised and cashed in on the market’s respect for the effort put into producing Australian food exports.

“As a beef producer and processor that really irritates me, and we as a group should demand a label to represent our agricultural produce.”

Raised in northern WA’s Pilbara cattle country, the mining magnate’s Minderoo farming business now covers 1.5 million hectares on six stations.

He conceded last week, he was often envious of his brother David’s agricultural expertise and specialist training at Victoria’s Marcus Oldham College, with David graduating from the Geelong college in 1980.

Andrew Marshall

Andrew Marshall

is the national agribusiness writer for Fairfax Agricultural Media


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